Risk Concentration Analysis By The Dozen

Audit Link, a division CU*Answers Management Services, announced today that they have completed their 12th risk concentration analysis for the CU*Answers client base. Since October of 2010 almost every credit union in the country has been required to complete a concentration risk analysis of their loan portfolio.  “Unfortunately, even though it is now a requirement, regulators gave very little advice on how credit unions should complete the analysis”, said Jim Vilker, VP of Professional Services. 

Using the capabilities of CU*BASE, the core system, Audit Link developed a model which helps not only segment out the loan portfolio but also stresses it to determine the maximum amounts credit unions should consider having in each segment of total loans. The results of the analysis are then used to evaluate the overall risk to the credit unions capital and give management the information and graphical reports for decision making and presentation to the board and regulators.